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How We See It - Changes to the ATVM Loan Program

How We See It - Changes to the ATVM Loan Program

Submitted by Tesla on Wed, 2011-09-21 11:42

Note: Inaccurate press stories state that Tesla has applied for another ATVM loan. Those reports are wrong. Tesla has no pending applications before the DOE.

Given the latest buzz about possible changes to the U.S. Department of Energy’s Advanced Technology Vehicles Manufacturing Program, Tesla would like to highlight the invaluable impact its ATVM loan has had on job creation and the acceleration of U.S.-based, gas free, electric vehicle technology:

1) We received our $465 million loan in 2009, the majority of which was directed to expedite development of the Model S sedan. Designed and manufactured in the United States using Silicon Valley technology, Model S will be the first zero-emission, zero gas, purpose-built EV on the market by mid-2012, a timetable we are on schedule to meet.

2) The remaining portion of the loan has helped us expand our electric powertrain-development activities. Tesla has partnered with Mercedes Benz-parent Daimler and Toyota to produce several electric vehicles at increasing volumes. As a result of those agreements, the United States is once again exporting cutting-edge automotive technology to Japan and Germany.

3) Since receiving the loan -- which demonstrated confidence in our technology and business plan -- and based on our continued ability to execute successfully on that plan, Tesla has raised an additional $620 million in private investment capital.

4) Prior to receiving the ATVM loan, Tesla employed 400 people. Since the loan’s closure, we have purchased the former NUMMI plant in Fremont, CA. With Tesla’s continued expansion at its headquarters in Palo Alto, the opening of new markets around the world, and the recent acquisition of the Tesla Factory in Fremont, Tesla has added over 1,000 new jobs. We project the addition of another 1,000 in the coming year.

5) A loan is a loan. With over 6,000 reservations for Model S, we’re looking forward to paying back our loan on schedule. Until then, we will continue to execute on the ultimate goal of building mass-produced EVs at affordable prices. Tesla will not rest until every vehicle on the road is electric.

Larry Chanin |
21 settembre 2011

Thanks for the information.

Can you share any information regarding any collaborations between Tesla and the government to expand charger infrastructure, particularly high speed chargers?

Thanks.

Larry

Vawlkus |
22 settembre 2011

Tesla buys their chargers, or has them made. As I understand it, they are not in the business to build recharging technology: they are in the business of designing and building all electric cars.

Brian H |
22 settembre 2011

The question was about infrastructure. Elon has suggested Tesla might install chargers for free every 100 miles along major routes.

Larry Chanin |
22 settembre 2011

Hi Brian,

I assume that refers to Tesla Level 2 chargers? If that's all that's available along a major route be prepared for a long wait while charging. Much more than what it would take to fill up an ICE vehicle and have a leisurely meal at a roadside restaurant.

I'm sure you agree that what we really need along major highways are Level 3 chargers. Since they are so expensive I was thinking that Tesla would probably need some form of government assistance with such a program.

Larry

Larry Chanin |
22 settembre 2011

@Vawlkus
"Tesla buys their chargers, or has them made. As I understand it, they are not in the business to build recharging technology: they are in the business of designing and building all electric cars."

That's true, but at this early stage of EV adoption, it probably would be in Tesla's self-interest to address the average consumer's legitimate concern regarding inter-city range. After the initial early adopters buy their cars, there will probably be a lull in demand if meaningful steps are not taken to address charger infrastructure.

As I stated in my previous posting, I don't expect Tesla to entirely funded Level 3 chargers on their own, but they certainly should lobby the government for infrastructure. Hopefully, election politics won't inhibit the continuation of government grants for EV infrastructure expansion.

around 33min mark Elon mentions Model S fast charging as independent technology developed by Tesla that they will install at 100 mile intervals on major highways free of charge.
Hope that plan sticks!

Vawlkus |
23 settembre 2011

I imagine most of that will depend on the resources they get from the sales of Model S.

Tesla doesn't have the resources to do what Elon is thinking of...... yet. IF they get a success from Model S and it's successors (and I believe they will) THEN they have the option to start in on programs like the one mentioned here.

jfeister |
23 settembre 2011

I read Tesla is applying for another government loan. I suppose it's a good idea to get cheap money when it's available, but I'm concerned about some of the political fallout. There is already a lot of animosity about tax payers funding luxury cars. Another government loan is just exacerbating the problem. Should Tesla really be sticking it's neck out like this after Solyndra? How badly does Tesla need the money? You've already received half a billion, plus $7500 off every car you sell. Perhaps it's better to be content with what you've got.

Timo |
23 settembre 2011

Loan is a loan. That is not a bailout money near-bankrupt US carmakers got or subsidies oil industry is getting that doesn't need to be paid back. Tesla needs to pay that loan back.

MTriantafelow |
24 settembre 2011

Tesla has twice as much money as it needs to bring the Model S and Model X to market as Elon has stated on Tesla's conference call (I think the Q1 call, though I didn't go back to check).

If they are applying for more money, my guess would be that it is to accelerate the BlueStar program and bring us a 30k EV. Remember that one of the requirements for this loan is that you must demonstrate viability without the loan money. The loan is for acceleration of advanced vehicle technology, not for bailing out cash-strapped companies. That's why GM and Chrysler did not qualify.

If Tesla "needed" the money badly, they certainly wouldn't get it. So, again, if they are applying for more money, I bet its to bring us BlueStar faster than they would otherwise be able to do it.

Vawlkus |
26 settembre 2011

Either that, or they think they'll need to expand their production capacity to meet demand for the Model S next year.

I mean, look at the facts, Elon said he was shooting for 5000 cars in 2012. According to the reservation list, we're already past that 5000 mark in production series alone, nevermind the Signature series. I think this is Tesla saying to the gov, "Holy **** demand is past what we can supply! If you want a few more sure jobs, give us a little extra to get more cars out to people!".

Personally, I think it's a good investment.

Tim W. |
26 settembre 2011

1) Seems to be a recycled talking point that is no longer true. They were first to announce a product that would be coming to market, but the Leaf is certainly purpose-built and is out there now, and other not-a-conversion electric vehicles will be competing in 2012.

My next new car purchase will be a Tesla, as soon as I can get a job, get out of debt, and afford to buy things again. I'm very happy that Tesla got loans (not grants, LOANS) to speed their development, because that means that when I CAN afford to buy things again the cheaper cars might be available.

I think "purpose built" means the frame up design, whereas the Leaf was build on an ICE frame. It's splitting some hairs making that distinction, but there's some merit in touting the fact that the Model S is design from scratch as an EV.

Brian H |
30 giugno 2012

9-month later update: loan repayments will begin early, towards the end of this year. Reservations are now about doubled from Sept '11.